vin

PREFACE

treated  entirely  by  itself  upon  the  basis  of  its  special  facts,
without  reference  to  wider  or  more  general  principles.
The  tendency  thus  to  fritter  away  the  unity  of  a  great
subject  into  an  ever-widening  number  of  component  parts
is  a  grave  intellectual  danger  which  induces  a  paralysis
of  all  work  of  practical  reform.  My  object  in  this  book  is
to  show  that  the  Unemployed  Question  has  a  true  unity
which  is  clearly  discernible  amid  the  facts  which  are  already
ascertained,  and  which  is  inevitably  hidden  by  the  sectional
treatment.  After  making  due  allowance  for  minor  contributory ­
  causes,  I  claim  to  establish  the  identity  of  Unemployment ­
  as  an  aspect  of  Trade  Depression  and  by  further
analysis  of  facts  to  establish  Under-consumption  as  the
direct  economic  cause  of  the  industrial  malady.  The
refusal  to  recognise  that  Industry  both  in  volume  and
character,  is  directly  determined  by  the  effective  demand
of  Consumers,  with  due  allowance  for  the  prophetic  or
stimulative  influence  of  Producers,  is  still  the  deepest
source  of  error  in  the  English  theory  of  the  structure  of
Industry.
The  identification  of  Unemployment  with  Under-consumption ­
  demands  an  explanation  of  that  failure  of  Consumption
to  keep  pace  with  Producing-power  which  is  recognised
as  a  general  feature  of  industry  in  highly  developed
countries.  This  explanation  is  found  in  causes  which
affect  the  distribution  of  power  to  consume  and  induce
individuals  to  endeavour  to  capitalise  “  unearned”  elements
of  income  at  a  greater  pace  than  is  economically  needed
to  satisfy  the  demands  of  current  consumption.
This  economic  analysis  of  the  phenomena  of  Trade
Depressions  does  not  claim  to  be  new  in  substance.
Several  early  economists,  in  particular  Lauderdale  and